The Ministry of Finance has moved to clarify that the MADANI administration has refrained from granting any new gambling licences or permits since assuming federal office at the end of 2022, maintaining instead the existing portfolio of licensed operators that have been operating under approvals dating back to the 1990s. The statement, issued on August 27, sought to address what the ministry characterised as misleading claims about the government's regulatory approach to gambling activities across the country.
The clarification was prompted by comments from Kedah Menteri Besar Datuk Seri Muhammad Sanusi Md Nor, whose remarks apparently suggested the federal administration had adopted a hands-off approach to gambling regulation. The MOF responded by emphasising that no expansion of licensed gambling premises had occurred under the current government's watch, and that strict operational conditions were imposed on all existing licensees as a cornerstone of its oversight framework. This distinction between maintaining existing licences and refusing to expand the sector forms a key pillar of the government's stated policy direction.
A significant shift in gambling activity came during the special draws mechanism, which represents one of the most visible manifestations of licensed gambling in Malaysia. During the Pakatan Harapan administration in 2020, the frequency of special draws was deliberately reduced from 22 occasions annually to just eight. However, the subsequent federal administration reversed this decision and increased special draws back to the original 22 times per year. Upon the MADANI government's assumption of power in late 2022, one of its earliest policy moves was to reinstate the lower frequency, cutting special draws from 22 back down to eight times annually beginning in January 2023. This decision signals a markedly more conservative posture toward gambling activity compared to the immediately preceding administration.
The MOF's statement reveals deeper layers to Malaysia's gambling governance structure that merit examination. All existing licences and permits currently active remain valid based on historical approvals granted years or even decades earlier, a legacy framework that the MADANI administration has chosen to preserve rather than overhaul. This approach maintains continuity in existing commercial arrangements while preventing new entrants from obtaining regulatory blessing. The framework also reflects the complexity of gambling regulation in Malaysia's federal system, where different governmental tiers hold distinct responsibilities for managing the industry.
A Federal Court decision on August 12 added another dimension to this regulatory landscape. The court rejected an application from the Kedah State Government seeking permission to appeal a previous ruling that prevented the state authority from issuing new gambling business premises licences. The three-judge panel unanimously upheld the earlier decision and ordered the state government to pay costs of RM50,000, effectively reinforcing the boundaries of state authority in this domain. The ruling clarified that responsibility for approving gambling business operations rests with the Ministry of Finance, while local authorities retain authority only to issue premises licences once ministry approval has been granted. This division of labour occasionally creates friction between state and federal governments with different political priorities.
Kedah's Menteri Besar Sanusi subsequently acknowledged this jurisdictional distinction while pointing toward the complexities inherent in the regulatory structure. His explanation underscored how gambling licence approval involves a multi-step process spanning federal and local governmental levels, each with defined powers and constraints. For Malaysian readers particularly in states where gambling regulation remains contentious, this clarification provides critical insight into which governmental body bears ultimate responsibility for policy direction. The reality that the MOF controls the critical first gate—ministry approval for operations—means that federal preferences significantly shape the sectoral landscape regardless of state-level sentiment.
The MADANI government's position reflects a careful balancing act between multiple constituencies with divergent views on gambling. Islamic-oriented parties within the governing coalition maintain principled opposition to gambling expansion, while secular and business-minded elements may view regulated gambling as a revenue stream and source of employment. By refusing new licences while maintaining existing ones, the administration attempts to satisfy concerns about gambling proliferation without immediately dismantling an established commercial ecosystem. This incremental approach characterises much of Malaysian policymaking on culturally and religiously sensitive issues.
Crucially, the MOF statement emphasised commitment to a multifaceted regulatory strategy that extends well beyond merely declining new licence applications. The ministry indicated its intention to maintain strict operational conditions for all licensed operators, intensify enforcement action against unlicensed gambling enterprises, and pursue sophisticated online gambling operators that operate beyond Malaysia's regulatory perimeter. This comprehensive stance acknowledges that gambling activity cannot be eliminated through licensing decisions alone; parallel enforcement mechanisms targeting the unlicensed and online sectors remain essential to meaningful regulation. For policymakers and researchers tracking gambling in Southeast Asia, Malaysia's approach demonstrates how governments attempt to manage demand when outright prohibition proves politically difficult.
The historical context matters considerably for understanding current policy. Throughout the period from 2020 to 2022, which saw PAS participation in the federal administration, no proposals emerged to pursue a nationwide gambling ban or revoke existing licences. This suggests a baseline consensus among Malaysia's major political parties that some level of regulated gambling remains acceptable policy, even as they disagree on expansion. The shift under MADANI toward stricter controls on frequency and new entrants represents a recalibration rather than a fundamental reorientation of gambling governance.
For Malaysian readers and businesses with interests in the gambling sector, the MOF's position provides important clarity: the current government has drawn a line against new commercial opportunities while stabilising the regulatory environment for existing operations. This stance affects not only the lottery and special draws operators but potentially extends to any sector adjacent to gambling, from retail premises to financial services supporting the industry. Investors considering expansion into or entry to Malaysia's gambling sector should understand that the MADANI government has signalled neither openness nor radical prohibition, but rather a measured maintenance of the status quo with enhanced oversight.
The broader implications extend beyond gambling policy itself. The interaction between state and federal governments on gambling regulation, illustrated vividly in Kedah's court battles, demonstrates how Malaysia's federal structure creates both opportunities and constraints for policy implementation. States with different political compositions may push regulatory agendas at odds with federal preferences, leading to legal contests that ultimately clarify and enforce the constitutional distribution of powers. This dynamic will likely resurface whenever state governments attempt to modify gambling regulations within their jurisdiction, particularly given the sensitive religious and cultural dimensions of the issue.
Moving forward, the MOF's clear articulation of current policy provides both certainty and constraint. Certainty exists for licensed operators who understand their licences will remain valid and that operational conditions, while strict, are not subject to capricious revocation. Constraint applies equally to those seeking entry to the formal gambling sector; the government has effectively closed the door to new licences while keeping existing businesses operational. This posture reflects MADANI's attempt to thread a needle between Islamic-minded coalition partners opposed to gambling and pragmatic recognition that an entrenched gambling industry cannot simply disappear through administrative decree.
